Cryptocurrency Analysis

[IFX_Selena]

BITCOIN: Crypto market nightmare

The market is bleeding from red candles, and this is all because of a strong information background from China, where the fight against mining and cryptocurrency is in full swing. It all started a month ago when the news broke that the Chinese authorities intend to take measures against the mining of cryptocurrencies and bitcoin trading.

Now the government's intention has moved into action. By June 20, five Chinese provinces have banned the operation of mining centers in their territories, which provoked a wave of outflow of capacity to the west.

In simple terms, miners are urgently fleeing from China to the west, which is confirmed by information from logistics companies that have already received orders to transport a large amount of equipment to the United States.

Due to the outflow and ban of miners, the amount of computing power of the first cryptocurrency fell to the levels of autumn 2020, which is considered a very strong change in hash rate in such a short period of time.

The crypto nightmare did not end there. Yesterday, June 21, the People's Bank of China (PBOC) held a meeting with the country's key financial institutions, during which the regulator banned them from participating in transactions with cryptocurrencies and instructed them to stop such activities.

This is quite a strong blow to the crypto industry, but this is not the end. Let me remind you that Bitcoin is still a legitimate digital asset that can be owned by Chinese citizens. But if this right is taken away by the government, then hard times will come.

To slightly dilute your fears and concerns about the future of the crypto industry, I will remind you that banks, financial funds, insurance companies, corporations, as well as qualified market participants are still working with cryptocurrency and are actively studying it as a new asset for investment.

Bans, threats, and psychological interventions against cryptocurrencies are constantly present in the information flow. This is not the first time China has conducted a sweep, and it is worth being vigilant now more than ever, as the speculative rollercoaster still takes place.

What happens on the trading chart?

The first cryptocurrency (Bitcoin) has been losing value for a week, but we still do not have any drastic changes. The quotes move in a fairly wide side channel in the range of $30,000 - $41,500. Three consecutive amplitudes in the established channel again led us to the lower limit of $30,000, where, together with the information flow, many traders were afraid of a possible breakdown.

There is fear since holding the price below $30,000 will lead to panic selling, and this will lower the quotes by $3,000-$5,000 in a short period of time.

In this case, sitting on the fence and analyzing the information flow is considered the most optimal trading tactic, but if you have a speculative portfolio, then you can play on local changes in the quotes.

In simple terms, if the bitcoin rate drops to $30,000, then we work on local short positions. After that, we analyze the scale of the weakening and buy back the cheaper BTC.







Gven Podolsky
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

Bitcoin breaks below $30,000.

Bitcoin's recent price action justified the push below the $30,000 price level. In our previous posts we noted the increased chances of seeing a new decline towards $25,000-$15,000. Bitcoin remains under pressure specially since bulls were unable to break above their defenses.



Bitcoin is breaking below the May 19th low. Price is heading towards our first target at the 61.8% Fibonacci retracement at $26,800. As we mentioned in previous posts the 61.8% Fibonacci retracement is a very possible first target. Trend is bearish as long as price holds below $40,000. Until then bears are in control waiting for another decline towards $25,000-$15,000.





Alexandros Yfantis
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

XRP/USD breaks below major support

XRP/USD is trading below $0.60 having broken below the major support area of $0.65-$0.75. XRP/USD is now trading at the 78.6% Fibonacci retracement of the entire upward move that started from $0.17 back in December of 2020.



Green rectangle - support (broken)

Back in April it was big news when price was breaking above the $0.65-$0.75 major multi year resistance. A back test of this break out zone was expected, however a break below this support area (previously resistance) is not a good sign. Price has retraced more than the 78.6% of the entire upward move from $0.17 to $1.97. So far the signs are not very optimistic for XRP/USD as a new low towards $0.40-$0.20 should not be excluded.






Alexandros Yfantis
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

BTC analysis for June 22,.2021 - Sellers are in control and potential for the bigger drop towards $21.000

Technical analysis:



BTC has been trading downside as I expected. The price reached the first downside target at $30.000 and it is heading towards second target at $20.000.


Trading recommendation:

Watch for potential selling opportunities on the rallies with the downside targets at the price of $20.735.

Stochastic is showing fresh bear cross, which is another sign and confirmation for the downside rotation.




Petar Jacimovic
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

Ethereum remains under pressure

Ethereum recently broke out of a triangle pattern and provided us with a bearish signal. In our last analysis we noted that after the rejection of the back test, the bearish scenario was stronger and we were expecting price to move towards $1,700 and lower. Today price is trading just above $1,700.



Ethereum is making lower lows and lower highs. Price is clearly in a bearish trend and is heading towards the 161.8% Fibonacci extension of the first leg down at $1,580. The RSI is showing some bullish divergence signs but there is no reversal confirmation yet.



Red lines - triangle pattern

Blue lines- base of triangle= size of decline expected

According to the triangle breakdown, the size of the decline should equal to the size of the base of the triangle. In this case our target is at $1,590-$1,600. Both views have similar targets below $1,650.





Alexandros Yfantis
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

Bitcoin price analysis for 22 June

Bitcoin price analysis turns bearish as price hovers near crucial support at $30,000
MicroStrategy has bought $489 million worth of Bitcoin during the recent dip
Wedge bearish pattern emerges on Bitcoin charts that is a cause of worry
BTC/USD touches a low of $31,160 amid a build-up of selling pressure



Bears are ruling the BTC/USD charts as the crypto looks poised to touch fresh new lows near the $30,000 support zone. The BTC price has crashed from $34,629 to reach $31,160 intraday low. The current market is under excessive selling pressure, which is evident from the RSI reading of 32. If the bears can pierce through the $30,000 level, the price can touch $25,000.

Bulls are looking for shelter as the technical indicators are sending multiple sell signals according to Bitcoin price analysis. With most charts in the red, hourly, and daily, the flagship cryptocurrency shows no sign of recovering from a recent downturn. The approximate 10 percent intraday drop threatens to retest the critical support region near $30,000 that may induce a long-term Bitcoin selloff.

The technical analysis of BTC/USD is now lined with multiple bearish signals. The most significant bearish pattern signifying a deeper malaise in the BTC price is the 'Inverse Cup and Handle' pattern. Here, Bitcoin price analysis suggests that the price action has built an inverted cup and signifies further correction in the BTC price. The price will rally upwards slightly and then move lower towards deep support regions.





Jan Novotny
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

Why does Bitcoin's price fall with a large reduction in cryptocurrency mining?



The Founder of Sublime Traders, Andrei Stanciulescu, said that the short-term trend for Bitcoin continues to decline and its price will probably reach the $ 80,000 mark by the end of the year. However, all cryptocurrencies need someone like Elon Musk to stimulate the coin to confirm the price increase.

Throughout the previous month, the price structure of the consolidation has been driven by a number of factors putting pressure on Bitcoin, most notably China's tightening of capital controls on cryptocurrencies.

CNBC's Jim Cramer said he had decided to sell almost all of his Bitcoin when it hit a two-week low on Monday, explaining that he was worried about a crackdown on cryptocurrency mining in China and ransomware attacks.

The week started with another Bitcoin sell-off. The main cryptocurrency approached the level of $ 30,000.

According to media reports, the price drop occurred over the weekend, when the fight against cryptocurrency in China spread to the southwestern province of Sichuan.

It can be recalled that Reuters quoted a notice last Friday issued by the Sichuan Energy Bureau and the Sichuan Development and Reform Commission. It says 26 cryptocurrency mining operations will be closed by Sunday.

Over the weekend, China's state-run Global Times news agency also published a report saying that more than 90% of China's bitcoin mining capacity will be shut down soon because local regulators are taking similar measures as in Sichuan Province.

In connection to these statements, the People's Bank of China announced that it has called on major banks and Alipay – a payment system operated by Ant Group, a subsidiary of Alibaba, to take tough measures against cryptocurrency trading.

In response to China's new restrictions, CEO of MicroStrategy Michael Taylor noted that the current situation is a tragedy for China, but a benefit for the whole world in the long term.

Adding to the news, MicroStrategy announced on Monday that it had bought another 13,005 bitcoins, bringing the total to more than 100,000 tokens worth more than $ 3 billion.

Cramer also questioned why the price of bitcoin is falling with such a reduction in cryptocurrency mining, emphasizing that if gold mining is reduced, the price of the precious metal will rise.



It is worth noting that back in March, Cramer advised diversifying the distribution of 10% in favor of gold with a distribution of 5% gold and 5% bitcoin.

He added that he invested $ 500,000 in bitcoin at some point in 2020, revealing that Morgan Creek Digital Assets Co-Founder Anthony Pompliano convinced him of the right investment. This, in turn, made him a lot of money.

But in mid-April, Cramer revealed that he had cut his Bitcoin position to pay off his mortgage. At the time, the cryptocurrency was trading near its all-time highs, exceeding $ 64,000.

He compared this income to fabulously fake money, which is paid for real money. But at the same time, the TV personality and CNBC host was satisfied with the payment of his mortgage loan.





Irina Yanina
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

Technical Analysis of ETH/USD for June 22, 2021

Crypto Industry News:
The Bank of Russia maintains its strict stance on cryptocurrency trading despite growing concerns about the country missing out on the benefits of the digital asset industry.

Russian central bank governor Elvira Nabiullina reiterated the bank's negative stance on cryptocurrencies in an interview with Komsomolskaya Pravda, arguing that crypto is one of the most dangerous investments in existence today.

Nabiullina mentioned cryptocurrencies in the context of other high-risk investment spaces such as the currency markets. "It's much easier to lose in the currency market than to win," she said, stating that "speculative crypto assets" are even more risky.

The bank governor said prices in the cryptocurrency market are extremely volatile, stating that "the losses can be huge." She further stressed that the Bank of Russia does not recommend the public to invest in cryptocurrencies:

"The central bank never gives investment advice, but in this particular case the bank strongly does not recommend it," he says.

Nabiullina previously stated that cryptocurrencies like Bitcoin are "counterfeit money" and should not be used for settlements in Russia. In 2017, she described the growing popularity of cryptocurrencies around the world as "the gold rush."

Despite being skeptical about cryptocurrencies, Nabiullina is optimistic about the digital ruble, the central bank's digital currency project. She said last year that a digital ruble would help businesses by eliminating financial intermediaries.


Technical Market Outlook:
The ETH/USD pair has hit the technical support located at the level of $1,887 and bounced towards the level of $2,00, which is a technical resistance for the price. Nevertheless, the bulls were capped at this level and the market reversed towards the level of $1,887 again. So far the lower low was made at the level of $1,867 (at the moment of writing the article). The next obvious target for bears is $1,729.

Weekly Pivot Points:
WR3 - $3,146
WR2 - $2,878
WR1 - $2,557

Weekly Pivot - $2,297
WS1 - $1,962
WS2 - $1,702
WS3 - $1,348


Trading Recommendations:
Ethereum has lost more than 50% of the recent gains from the lows of March 2020 and now is currently in the counter-trend corrective cycle. The next long-term target for bears is seen at the level of $1,728 (61% Fibonacci retracement of the last wave up) and $1,420 ( January 2018 swing high). The up trend is resumed when the level of min. $3,000 is clearly violated.






Sebastian Seliga
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

Technical Analysis of BTC/USD for June 22, 2021

Crypto Industry News:
According to a tweet published today by CEO Michael Saylor, business intelligence software developer MicroStrategy has just bought another batch of bitcoin, increasing its ownership to just over 105,000 BTC.

This time, the company bought another 13,005 BTC for $ 489 million in cash, at an average price of $ 37,617 per coin:

"MicroStrategy has purchased an additional 13.005 bitcoins for ~ $ 489 million in cash at an average price of ~ $ 37,617 per bitcoin. As of 6/21/21 we #hodl ~ 105.085 bitcoins acquired for ~ $ 2.741 billion at an average price of ~ $ 26.080 per bitcoin ".

The company recently offered investors the opportunity to purchase $ 400 million worth of backed securities, planning to invest their debt in bitcoin. The move received mixed feelings among many industry commentators. A day later, MicroStrategy increased the size of its offering to half a billion dollars.


Technical Market Outlook:
The BTC/USD pair keeps going lower towards the technical support seen at the level of $31,007. So far the lower low was made at the level of $31,240 (at the moment of writing the article). The next obvious target for bears is $31,007 and the round level of $30,000. There is still a room for another wave down as the market conditions are not oversold yet. The weak and negative momentum supports the short-term bearish outlook for BTC.

Weekly Pivot Points:
WR3 - $47,340
WR2 - $44,234
WR1 - $39,697

Weekly Pivot - $36,451
WS1 - $31,670
WS2 - $28,714
WS3 - $24,054


Trading Recommendations:
Even despite the recent correction the bulls are still in control of the Bitcoin market, so the up trend continues and the next long term target for Bitcoin is seen at the level of $70,000. Any correction or local pull-back should be used to open the buy orders. This scenario is valid as long as the level of $30,000 is clearly broken on the daily time frame chart (daily candle close below $30k).







Sebastian Seliga
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

Bitcoin continues to fall, MicroStrategy continues to buy



The fundamental background for bitcoin remains very weak and negative. China continues to tighten its legislation and prohibit mining on its territory, as well as any speculation in cryptocurrencies. Yesterday, it became known that all banks in China will be prohibited from providing any services to their customers related to cryptocurrencies. Earlier, it was reported that Beijing will completely ban any services with digital assets to all financial organizations of the country and, most likely, it will be so. Thus, the situation continues to deteriorate for bitcoin. Of course, it is still possible to own cryptocurrencies outside of China. There are many countries where it is not forbidden to mine it, own it, trade it, and so on. Thus, those who really want to do this business will find an opportunity to continue doing it outside of China. But ordinary Chinese traders will probably be cut off from the cryptocurrency market or will be forced to trade cryptocurrencies semi-legally. In general, such a tightening of the legislation in the country where the largest number of mining capacities is concentrated, clearly does not contribute to the strengthening of the bitcoin quotes.

Meanwhile, MicroStrategy, which was once engaged in the development of analytical software, continues to buy bitcoins. However, it already does this with the raised funds. Recall that most recently, the company placed 7-year bonds maturing until the end of 2028 in the amount of $500 million. Yesterday, it became known that with this money, the company purchased 13,000 bitcoin coins at the rate of $37.6 thousand. Thus, as we can see, the company is not even too "worried" about the bitcoin exchange rate itself and the search for the most favorable rate to buy. Now, the software developer has 105,000 bitcoin coins on its balance sheet, is the largest holder of "digital gold" among public companies and recently announced that it is going to raise about a billion dollars to buy new coins by selling part of its own shares. All this madness, of course, is very interesting to watch from the outside, but it becomes scary for the prospects of the company. We do not oppose bitcoin as an investment tool, but given its high volatility, tendency to collapse by 80-90% of the value and absolutely vague prospects, investing several billion dollars in it, and even borrowed funds, looks like a somewhat adventurous step.



In technical terms, on the 4-hour timeframe, bitcoin quotes declined to the updated support level of $31,100. A price rebound from this level can trigger a round of upward movement within the side channel of $31,100 - $41,000. But overcoming the level of $31,100 will open the way for sellers to the level of $24,000 per coin.





Paolo Greco
Analytical expert
InstaForex Group © 2007-2021